Housing is crawling its way toward a more sustainable pattern after a flurry of institutional investors flocked to residential real estate last year.

Such efforts resulted in an uptick in prices and picking clean the best inventory available in many areas. While the majority of the market believes institutional investors are now leaving the market, RealtyTrac vice president Daren Blomquist says this isn’t the case.

"It’s a market-to-market phenomenon and institutional investors are moving out of some markets and into others," Blomquist said.

He added, "They’re moving out of markets where there is less available units to purchase and moving into markets that have more inventory available, in particular, distressed inventory."

Institutional investor purchases accounted for 9% of all residential sales in June, up from 8% of all sales in May, but down from 10% of all sales a year earlier, according to RealtyTrac’s first-ever residential sales report.

States with the highest percentage of institutional investor sales included Georgia (23%), Nevada (16%), Arizona (15%), Oklahoma (13%), North Carolina (12%) and Florida (12%).

"Markets where sales increased in June tend to be in states with that lingering distressed inventory, whereas markets where sales decreased tend to be in states that more quickly absorbed distressed inventory thanks to a relatively fast foreclosure process and strong demand," Blomquist stated.

Meanwhile, sales of real estate-owned properties represented 9% of all residential sales in June, down from 10% a month earlier and on par with year ago levels. Metropolitan areas where REO sales accounted for higher percentages of total sales included Detroit (24%); Modesto, Calif. (24%); Stockton, Calif. (24%); Las Vegas (29%) and Akron, Ohio (21%).

The mild month-over-month change can be attributed to tight inventory in the for-sale market, explained Zillow senior economist Svenja Gudell. "Banks are releasing REOs for sale at a relatively slow pace in order to not flood the market and fewer short sales are a function of low inventory in general," she said.

Residential property sales reach an estimated annualized pace of 5.3 million in June, up 2% from the previous month and up 8% from a year ago, RealtyTrac noted.

Additionally, the national median sales price was $168,000 in June, up 3% from May and also up 5% from a year earlier. Short sales accounted for 14% of all residential sales in June, down from 15% in May, but up from 8% last year.

States with the highest percentage of short sales in June included Nevada (30%), Florida (29%), Maryland (21%), Tennessee (19%) and Arizona (19%).

"Home values have increased so much that fewer people are upside-down on their homes," said Prudential Detrick/Alliance Realty CEO Sheldon Detrick. "Last month’s increase in short sales is the tail end as short sales are becoming rarer. I guarantee there will not be any new short sales in the future."

The median price of a distressed sale was $120,000 in June, 34% below the median price of $181,500 for a non-distressed sale, according to RealtyTrac. States with the biggest distressed sale discount included Ohio (58%), Michigan (48%), Illinois (47%), Massachusetts (46%) and Wisconsin (45%).

"I think in terms of prices, you’ll continue to see the upward trend that’s been consistent across the board in those median home prices on a year-over-year basis," Blomquist stated.

"On the sales volume side, that differs quite a bit from market-to-market and we could see more volatility there. California showed volumes down 19% from last year, while Illinois was up 23% from last year, which speaks to the so called ‘shadow inventory’ that is helping to provide more sales."